* Cameco closes up 1.17 pct at C$32.07 on TSX
* Uranium One closes down 13.46 pct at C$3.73
* GE, nuclear utilities fall for second day
By Julie Gordon
TORONTO, March 15 Shares of Cameco Corp
(CCO.TO) staged a stunning recovery from an 11 percent fall on
Tuesday to close more than 1 percent higher, as investors
became less rattled by the nuclear crisis in Japan.
The world's No. 2 uranium producer closed at C$32.07, up
1.17 percent, after falling 22 percent over two days as Japan
raced to avert a radiation catastrophe at a quake-crippled
nuclear plant northeast of Tokyo. [ID:nLDE72D2FT]
"In my opinion (the selloff) was a knee-jerk reaction,"
said GMP Securities mining analyst David Wargo of the sharp
retreat by uranium stocks.
He added that positive news out of Japan would be a
catalyst to bump uranium and nuclear industry stocks back up.
In the days since the deadly quake, fears over the worst
nuclear accident since the 1986 Chernobyl disaster have
battered the shares of companies that build nuclear reactors
and produce the uranium that fuels them.
Industry giant General Electric (GE.N), which built two of
the reactors at the disabled Fukushima Daiichi plant, closed
down 1.4 percent on Tuesday. [ID:nN15231720]
Shares of U.S. utilities such as Entergy (ETR.N), NRG
Energy (NRG.N), Public Service Enterprise (PEG.N) and Exelon
Corp (EXC.N) also fell as the future of nuclear power in the
United States came under scrutiny.
On the mining front, Canada's Uranium One UUU.TO tumbled
as much as 21 percent to C$3.41, after UBS cut its target price
for the stock to C$4.80 from C$6.70. The shares rebounded a bit
to close down 13.46 percent at C$3.73.
Among other uranium producers, the Toronto-listed shares of
Australia's Paladin Energy (PDN.TO) closed down 5.18 percent at
C$3.48, while Denison Mines (DML.TO) fell 5.65 percent to
The Japanese nuclear crisis "is on the headline of every
newspaper," Wargo said. "So, until that ends, the overhang on
equities and the uranium market overall won't change."
With uranium miners and nuclear industry shares down
significantly over a two-day period, there are buying
opportunities to be had, said analysts.
After Cameco fell 22 percent, investors saw their window
and started snapping up Canada's top uranium producer, said
John Kinsey, a portfolio manager at Caldwell Securities.
He noted that speculative buyers sold off stock on Monday,
and then started buying back once it bottomed out.
"You get people that come in, sort of bottom-fishers, who
feel 'well now we've got some value'," he said.
Analysts said that uranium producers that are tied to the
spot market price will see a slower recovery than Cameco, which
sells much of its uranium into long-term contracts.
Uranium One, which fell 43 percent over two days, and
Paladin, which was down 30 percent in the same period, are both
"sensitive" to spot market shifts. They were the top stocks by
volume on the Toronto Stock Exchange on Tuesday.
The spot uranium price fell 9.8 percent to $60 a pound this
week, its biggest weekly drop since the global financial crisis
in late 2008. [ID:nLDE72E2EB]
BMO Capital Markets mining analyst Edward Sterck said the
price could drop further as the impact of the nuclear crisis in
Japan becomes more apparent, but he said he does not expect a
"I can't see us pulling back to the lows of just above $40
that we had the mid-point of last year," he said.
(Additional reporting by Euan Rocha; editing by Janet Guttsman
and Peter Galloway)